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Agenda Item No. 7

 

The Vale of Glamorgan Council

 

Audit Committee: 22nd February 2016

 

Report of the Head of Finance / Section 151 Officer

 

Regional Education Consortia

 

Purpose of the Report

  1. To provide Members with a response to their information and action request raised during the Audit Committee meeting held on 21st September 2015

Recommendation

That the Committee notes this report.

Reason for the Recommendation

To facilitate monitoring of the Internal Audit Shared Service.

Background

  1. Cabinet and Scrutiny Committee (Lifelong Learning) had, on 7th September and 20th July 2015 respectively, considered reports on the conclusions of Estyn and the Wales Audit Office (WAO) following their visits to the four education consortia. The report had outlined that Estyn and the WAO had visited the four regional education consortia between November 2014 and January 2015 to report on the progress being made by the regional consortia to provide school improvement services. Both reports contained recommendations for consortia, Local Authorities and Welsh Government to address and as such; Cabinet resolved that "the contents of the report be noted and the Wales Audit Office report be forwarded to the Audit Committee". The reason for the decision was that the report includes recommendations that relate to the responsibilities of the Audit Committee.
  2. The matter was referred to the Audit Committee and considered at their meeting held on the 21st September 2015.

Relevant Issues and Options

  1. In considering the references, Audit Committee noted that recommendations as contained in the report were generic to all Local Authorities, and the view was expressed that the Committee should be advised how the report and its recommendations related to the Vale of Glamorgan Council and its Audit Committee. Accordingly it was resolved - THAT a further report be brought before a future meeting of the Audit Committee outlining:

(i) The Vale of Glamorgan Council issues for the Audit Committee to consider;

(ii) Central South Consortium issues for the Audit Committee to consider;

(iii) How the Vale of Glamorgan Council's Audit Committee related to Rhondda Cynon Taff's Audit Function in relation to the Consortium.

  1. In respect of points (i) and (ii) above; the majority of recommendations made by both Estyn and WAO are a matter for Cabinet to consider, challenge and support and also fall within the responsibilities of the Council's Scrutiny Committee (Lifelong Learning) and not necessarily a matter for the Council's Audit Committee. It would only be a matter for the Committee when issues relate to the responsibilities of the Audit Committee as set out in their Terms of Reference. Part of these responsibilities include:-

"To review and determine on any issue referred to it by the Head of Paid Service; Section 151 Officer; Monitoring Officer or by a Director, or any Council body".

"To approve measures to ensure the effective development and operation of risk management and corporate governance in the Council";

"To consider the Council's arrangements for corporate governance and to approve necessary actions to ensure compliance with best practice".

  1. Cabinet has therefore referred this report to the Audit Committee primarily because the Wales Audit Office has identified issues in respect of the governance and financial management arrangements of the consortia which clearly fall within the purview of the Audit Committee. The Wales Audit Office report is attached at Appendix A.
  2. It is for the consortia to address and implement the recommendations to improve the effectiveness of governance and financial management arrangements and it is for the Consortia's Joint Committee consisting of Cabinet Members for all five authorities to seek the necessary assurances that this has been addressed. It is then the responsibility of the Cabinet Member and the Council's representative on the Executive Board to feedback progress to the relevant Scrutiny Committees; including the Council's Audit Committee so that they in turn can be satisfied that improvements are being made. One of the most effective ways to achieve this is by the submission of the Central South Consortium's Annual Governance Statement which will provide an annual opinion on the Consortium's overall governance framework including the system of internal control. Attached at Appendix B is a copy of the Central South Consortium 2014/15 Annual Governance Statement for reference.
  3. In respect of point (iii) - "How the Vale of Glamorgan Council's Audit Committee related to Rhondda Cynon Taff's Audit Function in relation to the Consortium. The Central South Consortium is a Joint Education Service commissioned by five Local Authorities namely: Bridgend County Borough Council; Cardiff County Council; Merthyr Tydfil County Borough Council; Rhondda Cynon Taf County Borough Council and the Vale of Glamorgan Council. The Legal Agreement for the Joint Education Service formally assigns Rhondda Cynon Taf County Borough Council as the Host Authority for the Central South Consortium and therefore, it is Rhondda Cynon Taf who provides all support services including Internal Audit.
  4. It is the responsibility of RCT's Internal Audit Section to undertake the appropriate reviews in order to provide the necessary assurances that there is a sound system of internal control; effective arrangements for the management of risk; adequate and effective financial management and good governance.
  5. Therefore, the Bridgend and Vale Internal Audit Shared Service will place reliance on the work undertaken by RCT via the Central South consortium Annual Governance Statement (as attached at Appendix B) and any matters of concern or significant governance issues will be reported to the Vale of Glamorgan Council's Audit Committee and if deemed appropriate would be reflected in the Council's own Annual Governance Statement.
  6. During 2014/15 RCT's Internal Audit reviewed the core financial systems of the CSC Joint Education Service and concluded there to be no material weaknesses. Internal Audit also reviewed the reports provided to the Joint Education Committee and the Legal Agreement (which incorporates the Terms of Reference for the Executive Board, Operation Management Group, Board of Management and the Joint Education Committee). No significant governance issues were raised during 2014/15 (see Appendix B).

Resource Implications (Financial and Employment)

  1. None as a direct result of this report.

Sustainability and Climate Change Implications

  1. There are no equality implications.

Legal Implications (to Include Human Rights Implications)

  1. None as a direct result of this report.

Crime and Disorder Implications

  1. None as a direct result of this report.

Equal Opportunities Implications (to include Welsh Language issues)

  1. None as a direct result of this report.

Corporate/Service Objectives

  1. The work of internal audit is intended to assist in the achievement of all corporate and service objectives.

Policy Framework and Budget

  1. The proposals in this report are in accordance with the policy framework and budget.

Consultation (including Ward Member Consultation)

  1. No further consultation is proposed.

Relevant Scrutiny Committee

  1. Corporate Resources.

Background Papers

None.

Contact Officer

Helen Smith - Operational Manager Audit

Telephone: 01656 754901

Officers Consulted

External Auditor - Wales Audit Office

Responsible Officer:

Carys Lord - Head of Finance / Section 151 Officer

 

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